CONTENT• Company Background• Problem Statement• Why there is Demand ?• Colgate Precision Design• Features• Positining• Investment Cost• Price• Branding• Promotion• Pros and cons of Positioning

COMPANY BACKGROUND in 1991

Global leader in household and personal care products.

•Total Sales - $6.06 billion

•Gross Profit - $2.76 billion

•Research and development expenditures - $114 million

•Media advertising expenditures - $428 million

Faced tough competition in international market from Procter & Gamble, Unilever, Henkel of Germany, Kao of Japan.

Colgate-Palmolive Company is launching

THE PRECISION TOOTHBRUSH

PROBLEM STATEMENT Defining the marketing strategy

Positioning, Branding & Communication

Strategies for new toothbrush.

COLGATE PRECISION

Why there is Demand ?

US TOOTHBRUSH MARKET

CONSUMER BEHAVIOUR

PRODUCT SEGMENT

US TOOTHBRUSH MARKET• US Oral Care Market is $2.9 billion in retail sales.• Annual growth rate is 6.1 %.• Toothbrushes had grown at average rate of 9.3%

per annum which is increased by 21% in value and 18% in volume.

• Dollar growth exceeded volume growth due to emergence of “super premium” sub-category of toothbrushes.

IN 1991

PRODUCT SEGMENTS

• Industry executives divided the toothbrush category into – value, professional & super premium brushes.

• Toothbrushes differed by bristle type and by head size.

Firm bristle brushes - 8%Medium bristle brushes - 39%Soft bristle brushes - 48%

(Sold per year)

New products introductions are focused on technical performance improvements, i.e.

Plaque removal and ease of use

• Many new toothbrushes are introduced on the basis of aesthetic rather than functional features.

• The children’s segment has seen a variety of new products targeting children featured sparkling handles, Bugs Bunny and other characters.

CONSUMER BEHAVIOUR• Consumers of baby boom generation were

becoming more concerned about the health of their gums as opposed to cavity prevention.

• Most consumers agreed that the primary role of a toothbrush is to remove food particles; plaque removal and gum stimulation are considered secondary.

• Choices are based on features, comfort, and professional.

COLGATEPRECISION

PRODUCT design

• The Precision toothbrush is a technical innovation.

• Researchers used infrared motion analysis to track consumers’ brushing movements and consequent levels of plaque removal.

• CP developed a unique brush with bristles of three different length and orientation.

It has triple-action brushing effect

1. The longer outer bristles cleans around the gum line.

2. The long inner bristles cleans between teeth.

3. The shorter bristles cleans the teeth surface.

• Brushing usually did a good job of removing plaque from teeth surfaces but was often ineffective at removing plaque from the gum line and between the teeth.

• The tests revealed that CP’s new design was superior to both Oral-B and Reach in accessing front and back teeth, using either horizontal or vertical brushing.

• Creating a bristle configuration and handle design offering maximum plaque- removing efficacy.

Features

POSITIONING

AS NICHE

PRODUCT

ASMAINSTREAM

PRODUCT

NICHE Product

• It could be positioned as a niche product to betargeted at consumers concerned about gum disease.

• it could command a 15% price premium over Oral-B and would be expected to capture 3% of the U.S. toothbrush market by the end of the first year following its launch.

• With a niche positioning, Precision retail sales wouldrepresent 3% volume share of the toothbrush market in year 1 and 5% in year 2.

MAINSTREAM Product

• Precision could be positioned as a mainstreambrush, with the broader appeal of being the most effective brush available on the market.

• As a mainstream product, Precision could capture 10% of the market by the end of thefirst year.

• With a mainstream positioning, these volume shares would be 10% in year 1 and 14.7% in year 2.

Investment Cost• Three types of equipment were required to

manufacture the Precision brush: tufters; handle molds; and packaging

machinery.

Price

AS NICHE PRODUCT AS MAINSTREAM PRODUCT

BRANDING

• The Colgate Precision name was consistently viewed more favorably—it was deemed appropriate by 49% of concept acceptors and appealing by 31%.

• It was estimated, both under the mainstream and niche positioning scenarios, cannibalization figures for Colgate Plus would increase by 20% if theColgate brand name was stressed but remain unchanged if the Precision brand name was stressed.

• Consumers were exposed to various product claims in prototype print advertisements and then asked about the likelihood that they would purchase the product

DISCLAIMERCreated by Yash Jain, NIT Jalandhar,Jalandhar, during a marketing internshipUnder Professor Sameer Mathur, IIM

Lucknow